NOV is Wednesday's IBD Stock Of The Day, as the oil and gas industry equipment provider moved above a buy point. NOV stock, fueled by $93 per barrel U.S. oil prices, surged Wednesday morning and has advanced 6% on the week — even as the S&P 500 has declined slightly.
Houston-based NOV has expertise in deepwater oil and gas technology along with full-field drilling completion and production services. NOV works with energy companies in 62 countries through its three business segments, including rig technologies and well completion and production solutions.
West Texas Intermediate (WTI) oil prices climbed 3.8% above $93 per barrel on Wednesday, extending gains from the previous session amid concerns about tightening global supply. The U.S. oil benchmark has surged around 30% since the end of June.
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Energy-related stocks have followed oil prices upward trajectory, rallying since June, after a fall from 2022 highs driven by Russia's Ukraine invasion. U.S. oil producers and the Saudi Arabia-led Organization of Petroleum Exporting Countries and its partners have kept global oil supplies tight. However, the outlook for demand remains uncertain, with China's economy struggling, and the outcome of the U.S. battle vs. inflation yet to be determined.
NOV reports third-quarter earnings in late October. Wall Street forecasts earnings growing 67% to 35 cents per share with revenue increasing 13% to $2.13 billion. For the full year, analysts predict profit will surge 184% to $1.45 per share and sales will total $7.24 billion, a 31% increase vs. 2022.
NOV Stock
Shares shot up 4.7% to 21.55 in strong Wednesday market trade. NOV stock has retaken a 20.98 buy point from a cup-with-handle base, according to MarketSmith.
NOV stock was added to IBD Leaderboard on Wednesday.
The stock also bounced from its 50-day line, breaking a downtrend line. Despite Wednesday's advance, NOV stock is up only 2% in September. Shares have surged more than 30% in the third quarter though.
NOV stock sits third in the IBD-tracked Oil & Gas-Machinery/Equipment industry group, which has outperformed the S&P 500 in 2023, gaining about 22% so far this year.
NOV is highly dependent upon the level of activity in the oil and gas industry, which can be volatile. Last week active U.S. drilling rigs decreased by 11 to 630, according to Baker Hughes data. The prior week broke a string of nine straight declines in the number of drilling rigs working in North America with U.S. drilling rigs gaining nine to 641.
NOV stock has a perfect 99 Composite Rating out of 99. Shares have a 91 Relative Strength Rating and its EPS Rating is 81 out of 99.
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